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🛑🛑🛑🛑🛑🛑
Combined nifty call OI addition of the day now moved to nearly 60 lakhs now from earlier post 46 lakhs
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BTVI: IMD: Expect Monsoon Deficit To Narrow Further This Month
Expecting Normal Monsoon At The End Of This Season
Summer-Sowing Has Picked Up Pace, Will Issue Monsoon Update In First Week Of August
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Open Interest updates
Yesterday added nearly 32 lakhs OI in nifty monthly 11700-11650-11600 calls together...it was simply big....I am talking about Monthly strikes and not weekly strikes expired yesterday..
And today again got added around 46 lakhs OI in Nifty monthly 11700-11650-11600 -11550 -11500 calls..
This is huge and in 11600 calls alone got added 21 lakhs OI today
So looks tough for a close above 11600 now...
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Why EXID & AMRJ down 4%+ with vols
-Industry sources says they have cut pxs recently by 5-7% recently to deal with weak demand.
- Lead, the basic Raw Mat is up 2.5% in last 3 days & up ~10% in last one month
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In last 19 years baring 2002 and 2000, Nifty has never closed July month below the low of June month.
#AceEquities
June low is 11625 on Nifty Spot this time.
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Economic Times
Business Standard
Ø SEBI chief reignites autonomy debate over sharing surplus funds to govt
Ø Credit, deposit growth manage to remain in double- digits
Ø Sebi proposes tighter disclosure on auditor resignation
Ø India's CAD grew to $68 billion in 2018-19: IMF
Ø Direct Tax Code report to be submitted by July 31: FM
Ø Yes Bank stabilised in Q1 in terms of asset quality
Ø REC raises $650 million via bonds, aids sovereign sales
Ø No relief from super-rich tax for FPIs structured as trusts: Sitharaman
Ø Vodafone Idea hires Bank of America, Morgan Stanley for $1.9-bn fibre sale
Ø IL&FS senior management asked ICRA for 'desired ratings': ED probe
Ø 17% of corporate social responsibility fund unspent among listed companies
Ø Draft labelling regulations for packaged food and beverages divide industry
Ø Jet Airways interim RP receives claims worth Rs 24,000 cr from lenders
Business Line
Mint
Ø Escorts eyes double-digit growth in construction equipment biz
Ø ACC’s profit up 39% on higher realisation
Ø EU clears Vodafone’s $22 billion deal to expand in Europe
Ø BHEL bags ₹750-cr order from NTPC-Railways JV
Ø HDFC m-cap tops ₹4-lakh cr mark as shares zoom to record high
Ø Consumer goods growth slows as rural demand cools: Report
Ø India's current account balance deficit grew to $68bn in 2018-19: IMF
Ø IL&FS conducts forensic audit of group firms' rating agencies in last 10 years
Ø New amendments to IBC will protect interest of homebuyers: Centre to SC
Ø Ultratech to complete Century Cement merger by September: Kumar Mangalam Birla
Ø IL&FS: NCLT allows govt to prosecute auditors Deloitte, BSR
Financial Express
Deccan Chronicle
Ø CCI approves Nippon Life Insurance’s acquisition of up to 75 percent stake in RNAM
Ø Government considering capital infusion in BSNL
Ø ADB cuts India’s GDP growth forecast to 7 per cent for FY20
Ø Amid a row over RBI reserves, Modi govt eyes SEBI funds
Ø Icra revises rating for Reliance Powers’ Rs 8,015-crore debt to ‘default’
Ø G7 ministers reach consensus on taxing tech giants like Google, Amazon: France
Ø Gold rises by Rs 170 on jewellers' buying, silver jumps Rs 910
Ø Rupee skids for 3rd straight day; settles 15 paise down at 68.97 vs USD
Ø Sensex tanks 318 pts; Nifty closes below 11,600
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@TradeWithZebull
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Himatsingka seide ltd--50% stock buy current mkt price 158 and 50% stock buy 145 and hold for 1 years tag 400 to 450.
Anil kamboj
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Economic Times
Business Standard
Ø IMF sees dangers from trade tensions, overvalued dollar
Ø FPIs pull out Rs 4,120 cr in July, highest this year
Ø BP, Reliance investing $5 bn in KG-D6
Ø Adani Transmission seeks shareholders' nod to raise Rs 5,000 crore
Ø Wipro Q1 profit up 13% YoY to Rs 2,388 crore
Ø Transition to e-cars may take longer than 2030: TERI
Ø Singapore based First Degree to buy Essel para banks
Ø Jalan panel to suggest RBI transfer surplus capital to govt in over 3-5 yrs
Ø Govt may hive off Coal India into separate listed firms to raise funds
Ø Govt clears 7 amendments to IBC, extends Finance Commission's term
Ø Yes Bank Q1 consolidated net profit slumps over 92% to Rs 96 crore
Ø Govt likely to oppose NCLAT's Essar Steel order in Supreme Court
Ø Sebi chief questions Budget plan for transfer of surplus funds to govt
Business Line
Mint
Ø Weak economy drags steel, cement prices down
Ø Strategic sale of Hindustan Antibiotics, Bengal Chemicals cleared
Ø CAG finds deficiencies in ONGC’s marine logistics operations
Ø Bill to amend companies law to be re-introduced in Parliament
Ø RINL targeting ₹25,000-cr turnover: CMD
Ø Japan’s Uniqlo sews up plan for India entry
Ø Thirteen banks move Delhi HC against service tax demand of ₹38,000 crore
Ø Fifth CPSE ETF tranche set to open
Ø US FDA red flags significant violations at Strides Pharma’s Puducherry unit
Ø Mindtree Q1 consolidated net profit falls 41% to ₹92.7 crore
Ø Microsoft, AT&T sign cloud deal worth more than $2 billion
Financial Express
Deccan Chronicle
Ø Yes Bank probing whistleblower claim of irregularities in operations
Ø Jaypee insolvency: NCLAT asks IDBI Bank to furnish conditions for fresh bidding
Ø BP, Reliance investing USD 5 billion in KG-D6 to produce 1 bcf of gas
Ø Easing business climate, trade norms to help India attract FDI, improve CAD, says IMF
Ø Govt to prepare national data on unorganised sector
Ø Rupee falls 11 paise to 68.82 vs USD on foreign fund outflows
Ø Govt may cap overseas borrowing at USD 5 billion this year: Report
Ø 330-day deadline for insolvency resolution
Ø Strides shredded, dumped key documents: US Food and Drug Administration
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Vedanta Cairn and Gas won 10 oil blocks in the second and third round auctions as a part of Open Acreage Licensing Policy of the government.
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Sadbhav Infrastructure: April-June period toll revenues rise 2.3 percent to Rs 280 crore YoY.
KRBL: CARE placed the company's commercial papers worth Rs 700 crore under credit watch with negative implications.
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Tata Power ties up with NTT Com-Netmagic to set up 50 MW solar project
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Budget impact: Tax on liquor licence fee scrapped retrospectively
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Yes Bank goes bullish on MSMEs; looks to prune turnaround time to one day
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Jet Airways lenders to set rules this week to weed out casual bidders
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India's Vedanta to invest $650 million in new oil blocks
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Group of Ministers discuss revival of BSNL, MTNL
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Rs 1L cr at stake! DHFL lenders may take 50% haircut in rescue
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#FINANCEBILL #FPI
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*CPSE ETF FFO 5*
1. Category Allocation:
Anchor : 30%
Retail : 70% (Retirement trust, Individuals & QIBs
2. Discount : 3 %
3. Subscription Dates : Only 18th/19th Jul 2019
18th Jul : Anchor
19th Jul : Retail
4. Allotment & Refund: 26th Jul
5. Listing is on 29th Jul
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News and Impact
Expect market to open on a weak note on account of global cues. US market declined half percent on the concern of US-China trade war after the US President tweets. Moreover, market expectation of delay US Fed rate cue after US Retail sales data reported better than expectation. Asian markets like Hong Kong, Nikkei, Index declined over half percent each. SGX Nifty declined 22 points or 0.2%
Sector watch – Banking, NBFC, Auto, Oil marketing companies
Actionable – BUY SBI, BOB, Shriram Transport, Axis Bank, Sell - IndiGo
Momentum Buy – M&M Finance, Canara Bank, PNB
Watch on Oil marketing companies – Brent Crude declined 4% to $64/bbl after reduce geo-political tension between US-Iran. Sharp decline in oil price and fall in USDINR will be positive for oil marketing companies like HPCL, BPCL and IOC.
Market sentiment is positive on account of fall in Oil price, USDINR and 31-month low G-Sec Yield. Reduced monsoon deficit and good results by Infosys have boosted the market sentiment. However, traders buy on dips in the market. Expect Banking stocks to be in focus ahead of Yes Bank results and fall in bond Yield. FIIs net sellers to Rs4.45bn yesterday.
Major events today – Supreme Court verdict today expected 9.30am on Karnataka Political issue, Wipro and Yes Bank results, Bimal Jalan committee report on Reserve Bank and bond yield trend.
Brokers Radar – CITI raised TGT on Federal Bank from 110 to 120. Morgan Stanley TGT on HDFC AMC 2200, UBS TGT on Quess Corp 865, CLSA on Power sectors – BUY NTPC 170 and Power Grid TGT 230, Philips Capital reduced Titan TGT to 1165 from 1200.
Media news that the Jalan Committee will submit the report today to the government. Reserve Bank has over Rs 9lak Cr. surplus reserve – Positive for the economy.
Major results today – Wipro, Tata Elxsi, Mindtree and Yes Bank
Watch on PSU Bank 10-year Yield over 30-month low (Positive PSU Banks – BUY SBI) – 10-year G-Sec Yield continued to southbound journey on hope of RBI to cut interest rate in the next policy meeting. Moreover, government likely to issue overseas bond worth $10bn is one of the reason on declined 10-year Yield. 10-year G-Sec Fell to 3-month low at 6.34% and declined 60bps in the last 3-weeks. Fall in G-Sec Yield will big positive on PSU Banks – SBI and BoB our top pick – PNB, Canara Bank, Union Bank will be positive. ICICI Bank, Axis Bank will be positive after a fall in G-Sec Yield.
HDFC AMC reported good quarterly results. Company reported Q1 net profit Rs2.92bn (up 42.4% YoY), EBIDTA at INR 3.96bn, +48% YoY [led by fall in fees/commission expenses INR 114mn vs. INR 839mn and other expenses], Margins 78.5% vs. 56.7% YoY and income Rs5.04bn (up 7%)
DCB Bank reported inline with expected Q1 results, marginally increased GNPA. We have a neutral rating on the stock. Company reported Q1net profit Rs810.6mn (up 16.6% YoY) - expectation Rs973mn, GNPA 1.96% vs 1.8% (expectation 1.8%), provision Rs406.4mn - expectation Rs417mn and NII Rs3.05bn (up 11.7% YoY) - expectation Rs3.13
Federal Bank reported higher than expected Q1 net profit on account of lower provisions & higher other income supported earnings. Stable asset quality is a positive and we have a buy rating on the stock. Federal Bank Q1net profit Rs3.84bn (up 46% YoY) - expectation Rs3.48bn, provision Rs1.92bn - expectation Rs2.22bn, GNPA 2.99% vs 2.9% (expectation 2.8%), Gross NPLs increased 4% QoQ to Rs33.9b while Net NPLs increased 3% QoQ to Rs16.7b. PCR ratio improved 60bp QoQ to 50.7%, Net NPA 1.5% vs 1.7% (QoQ) - expectation 1.4% and NII Rs11.5bn (up 18% YoY) - expectation Rs11.8bn.
MCX reported Q1 net profit Rs440mn vs Rs73mn previous quarter, company reported income Rs1.11bn (up 30% YoY). EBITDA increased by 58% at Rs590mn and EBITDA margin 53%.
Rating agency Moody's affirms ONGC Baa1 ratings; outlook stable - Positive for ONGC after a stable outlook by rating agancy.
Watch on Tata Sponge – Company’s right issue subscribed by 40%. Tata Steel likely to buy right issue of balance 60% according by media news - Positive
Apollo Hospital to exercise call option on Rs2bn, 10.2% bonds - Positive for Apollo Hospital as the company will exercise option before maturity.
Watch on Shriram Tranport – Company likely to issue Rs100bn bond issue for the liquidity in the systems – Positive for Shriram Transport Finance.
IndiGo co-founder Rakesh Gangwal says won’t sell stake in Airline amid feud, media news of regulatory pressure on IndiGo of hare holders agreement between the two promoters Rahul Bhatia and Rakesh Gangwal – Conflict of two promoters of various issue is a concern in the market. Traders be caution on IndiGo.
Watch on Tata Motors - JLR to get £500-million UK loan guarantee to develop next generation EVs – stock gained 4% yesterday after the news. However, news is positive on Tata Motors.
Dewan Housing lenders may accept limited haircut in rescue plan - reuters - News is positive but traders avoid on the stock.
Vakrangee to set up EV Charging infrastructure across India, Vakrangee aims for at least 75000 charging outlets by FY21-22 - Avoid on the stock weak fundamental
Cummins India MD Sandeep Sinhgh resigns - Stock declined 5% after the news. Long term buying opportunity after the recent decline
V2 Retail Vipin Kausihk resign as CFO - Negative for V2 Retail
Moody's assigns Baa3 to Adani Ports and Special Economic Zone's proposed bonds. The outlook on the ratings is stable - Positive for Adani Port after a stable outlook by rating agency Moody.
Suzlon defaults on $172-mn bonds, in talks with investors for stake sale – Negative for Suzlon – Avoid any bargain hunting on Suzlon.
Jet Airways lenders to set rules this week to weed out casual bidders - Lenders to Jet Airways will vote this week to decide who all can bid for the bankrupt airline, as they don’t want any frivolous players in the race, the committee of creditors (CoC) discussed in its first meeting on Tuesday – Avoid Jet Airways
TV18 Boardcast Q1 net profit Rs186.4mn vs loss 124.8mn, other income Rs330mn (up 342% YoY) and Income Rs12bn (up 10% YoY) - Avoid
Government said to plans road shows in August in bid to sell Air India - Positive for economy to reduce its fiscal defecit after a huge loss making Air India
Network 18 Q1 loss Rs1.41bn, onetime loss Rs500mn, standalone loss Rs3.26bn and income Rs12.5bn - Avoid the stock.
UPL - ADAMA expects first-half sales to decline, as continued tight supply combined with delays in planting due to weather conditions delayed and reduced crop protection applications in many places around the world – we are long term positive on UPL
Adani Ports Begins Tender Offer for 2020 $650m 3.5% Senior Notes. Settlement date expected to be on or around July 25 - Positive for Adani Ports
Hudco gets Rs41.85b total bids for 3-Year 60-day bonds - Company gets bids in the range of 7.15% to 8%. Issue size Rs2.5b, with Rs10b green shoe Option - Positive for Hudco after strong response its bond issue.
Court Quashes Rs40b Mumbai Road Project Clearance: The Bombay High Court on Tuesday quashed the Coastal Regulation Zone clearances given to Mumbai city civic body’s coastal road project. Project planned to connect Marine Drive in south Mumbai with Borivali in north Mumbai. In 2011, Government relaxes coastal development Law, Allowing Mumbai Projects - Expect positive for Infra stocks like NCC, IRB Infra
Dividends – Federal Bank, Grindwell Norton, Megmani Organics, Tejas Networks, Voltas, Zydus Wellness
Board Meetings – Manappuram Finance, MindTree, Tata Elxsi, Wipro and Yes Bank
AGM – Can Finance Home, ICICI Prudntial Life, South India Bank and Tata Elxsi
Results – MindTree, Tata Elxsi, Wipro and Yes Bank
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Economic Times
Business Standard
Ø Iran to invest in Indian refinery, says ambassador
Ø WTO opens way for Chinese sanctions against U.S.
Ø India's Vedanta to invest $650 million in new oil blocks
Ø Banks bad loans down at Rs 9.34L crore: Sitharaman
Ø Lenders to DHFL ready for haircut in rescue - sources
Ø Centre cuts interest on GPF by 10 bps to 7.9 per cent
Ø Cox and Kings defaults again; shares at record low
Ø 10-year bond yield hits lowest level since demonetisation, closes at 6.33%
Ø Moody's affirms Baa1 rating to state-owned ONGC over better oil prices
Ø Future of Wipro will outshine everything done so far: Azim Premji
Ø Goyal backs multi-brand FDI policy, says no changes in the offing
Ø Federal Bank Q1 net profit up 46% to Rs 384 crore as bad loans ease
Business Line
Mint
Ø SEBI provides new format for compliance report on corporate governance
Ø HDFC AMC Q1 net profit zooms 42 per cent, at ₹292 crore
Ø Jet Airways creditors set insolvency process in motion
Ø Passenger vehicles retail sales dip 4.6 per cent in June: FADA
Ø Bharat Dynamics eyeing ₹25,000 cr order book in next four years
Ø Retail investors can also participate in the primary market issues of G-secs
Ø Essar Steel case: Lenders move SC against NCLAT order
Ø DCB Bank Q1 profit jumps 16.63% at ₹81.06 crore
Ø Creditors' committee of Jet Airways to vote on $10-million interim funding
Ø Bombay  HC  quashes permits for ₹14,000-crore  coastal road project
Financial Express
Deccan Chronicle
Ø 2,500 drugs samples out of 76,000 examined found substandard in 2018-19
Ø Oil India signs contract for 12 oil blocks; Vedanta 10, ONGC 8
Ø Taxmen detect Rs 37,946 crore fraud in FY19
Ø India’s renewable energy capacity crosses 80GW-mark, says RK Singh
Ø NSE to exclude DHFL shares from equity derivatives segment from Sept 27
Ø Rupee falls 17 paise against USD on rising crude, capital outflow
Ø Private banks’ share in MF holdings nears 20 per cent
Ø KPMG makes bid to revive Videocon
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Nifty Derivative Analysis:
* IL&FS finally Monetising Assets for there 3 companies.
* Government to Raise about 11000 cr through CPSE ETF
* Export fell by 9 %.
===================
Nifty OI. : 1.66 cr
Bank nifty OI : 17.0 lacs
PCR. : 1.22
Adjusted VIX: 9.83
=====================
* Retail bought call 40.94 and sold Puts 24.46lac = 65.40
lac Long in the market.
* FII Bought 47.41 Lacs Puts and Sold index futures 33.54lac
* Prop guys Sold call by 65.39 and sold Puts 26.30 lac = Net Short by 39.08
Conclusion:-
* Retail = Positive in the market
* FII = Negative in the market
* Prop. = Negative in the market
====================
Open position:
* Sold 32,000 Bank Nifty Call @ 50 and bought 29,000 Bank Nifty puts of 25th July.
* Sold Nifty @11550 SL 11640
=====================
Wish u a Profitable day.
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Private lender IndusInd Bank reported a 38.30 per cent year-on-
year jump in consolidated profit at Rs 1,432.50 crore for the June
quarter. The bank had reported a net of Rs 1,035.72 crore in the
year ago period. The lender posted a net interest income of Rs
2,844 crore. Gross NPA stood at 2.15 per cent in the June quarter
against 2.10 per cent sequentially, while net NPA came in at 1.25
per cent compared with 1.20 per cent on a quarter-on-quarter
basis. The lender's absolute gross NPA was Rs 4,200 crore against
Rs 3,947 crore in March quarter. Meanwhile, provisions of the bank
inched up to Rs 431 crore on a yearly basis from Rs 350 crore,
while they saw a big slump from Rs 1,560 crore on a quarterly
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News and Impact
Expect market to open on a flat note on account of global cues. U.S. Dow Jones surged nearly 1% to close record high of above 27k on hope of US Fed to cut interest rate in the next policy meeting on 31st July. US Future is up 87 points or 0.3%.
Asian markets open on a caution note ahead of China economy data (export, import data) will be announced today. Moreover, Singapore GDP data declined -3.4% have a negative impact in the Asian markets. As a results, Nikkei, Hong Kong and China Index are flat to negative. SGX Nifty declined 9 points. European market declined after the IMF concern about trade tension, Brexit and slowdown Italy economy.
Brent Crude spiked to above $67/bbl of 2-month high and FIIs continued net sellers (Yesterday FIIs net sellers Rs3.17bn) which is a major concern in the market. On the other hand, fall in USDINR and 10-year G-Sec Yield 2-year low will be positive for the market. However, traders avoid aggressive buying, buy on dips strategy with strong fundamental stocks (Maruti, UltraTech, ICICI, HDFC Bank).
Yesterday, Nifty gained 0.7% rebounded from their lowest close in nearly two months, tracking regional peers after comments by Federal Reserve Chairman Jerome Powell signaled a willingness to lower interest rates.
Earnings guidance will be closely monitored by investors as economic growth slows. Infosys and IndusInd Bank are the next major Indian companies to report, with their results scheduled today. Inflation and factory data reports also to be announced today which may influence sentiment.
Sector to be watch – Auto, Metal and Tech
Actionable - Maruti, Aurobindo Pharma and Jindal Steel
Momentum Buy – Motherson Sumi, IndiaBull Housing, DHFL.
Brokers Radar – CLSA BUY HDFC TGT 2730, CLSA BUY NTPC TGT 157, Credit Swiss BUY M&M TGT 850, UBS BUY Lupin TGT 900, Nomura BUY Glenmark Pharma TGT 867, Bank of America rasied ACC TGT 1896, Goldman BUY on D-Mart TGT 1740.
Major events today – Infosys and IndusInd Bank will be announced Q1 results today. US delegation will meet today with the government for trade related issue. Industrial Production and Inflation data also will be announced today.
Infosys expectation – Infosys Q1 Dollar term revenue expectation $3122mn (up 2% QoQ), EBITDA margin expectation 23.5% and net profit expectation Rs36.57bn (down 10.3% QoQ).
indusInd Bank – Watch on NPA details and any recovery from IL&FS, As of now Rs30bn exposure on IL&FS.
KPR Mill first company to withdraw share buyback after Budget imposed 20% tax. Expect others companies will be withdraw share buy back – Negative for the market.
Watch on Emami – Company released 17 lakh pledge share – Positive for Emami.
Watch on Ashok Leyland and Tata Motors – Both the companies shut its plant by 10-12 days on account of slowdown demand – as per media report – Negative for Ashok Leyland and Tata Motors
Media news that the government has sought information from the SEBI about the origin of those foreign portfolio investors (FPIs) that use the trust structure and asset they manage. Govt. also want details tax liability, custodians provide all data barring tax information – It may negative impact of foreign flow
DHFL Still in Talks With Aion, Cerberus, Oaktree for Deal: Dewan Housing Finance Corp.’s lenders have assured non-convertible debenture holders of a “comprehensive resolution plan” that would maximize value for all stakeholders - Avoid Dewan Housing.
DHFL resolution plan - Cash-strapped DHFL will be submitting a resolution plan (RP) to its lenders early next week. The RP will be discussed by lenders and the same would thereafter be adopted with modifications/ changes as they deem fit, said sources clued in to the developments. At a meeting on Thursday attended by lenders and non-convertible debenture (NCD) holders, bankers are understood to have agreed to go ahead with the modalities of signing the inter-creditor agreement (ICA). They also want to take the NCD holders into confidence when framing the RP. This is aimed at ensuring that all stakeholders realise their dues to the maximum extent possible – Positive on DHFL.
Rating agency - Fitch affirms Glenmark Pharma at BB, outlook stable - Positive for Glenmark
NTPC plans to sell up to Rs45bn of 10-year Bonds - Positive for NTPC, strong balance sheet and attractive dividend yield.
Housing affordability worsened in India in the last four years. Indians now spend a bigger proportion of what they earn on buying a home than in 2015, according to the RBI’s residential asset price monitoring survey of 13 cities. The house price to monthly income ratio has risen from 56.1 in March 2015 to 61.5 in March 2019. The ratio has remained above 60 since December 2015 – Positive for housing finance stocks like PNB Housing, India Bull Housing, Can Finance Home.
Government increases Coal extraction price for steel, cement firms - Companies including Hindalco Industries, JSW Steel, Tata Sponge Iron and UltraTech Cement will need to pay 3.62% more for every ton of coal extracted from mines they won in auctions - It may not major impact on Cement and Steel sectors. Coal India likely to be positive.
Tata Investment names Abhijit Sen and Jimmy Tata additional Director - Positive development on Tata Investment (Not our coverage)
Gravita India starts output of Aluminum cast alloys at Tanzania - Positive for Gravita India
United Breweries names Berend Odink as CFO - positive for United Breweries
Tata Motor JLR June Global wholesales at 95503 unit, declined 5% YoY - Tata JLR sales volumes increased gradually. Moreover, will be positive for Tata JLR if the US Fed cut interest rate
Glenmark Pharma, Torrent sign pact for Remogiflozin Etabonate - Under the terms of this non-exclusive agreement, Glenmark will manufacture and supply Remogliflozin Etabonate while Torrent will market the drug under its own trademark in India - Positive for Glenmark and Torrent Pharma
Can Fin Homes to consider sale of Rs60bn of debentures July 22 - Positive for Can Finance House
Sun Pharma : U.S. FDA approves Sun Pharma’s Risedronate Sodium ANDA - Positive for Sun Pharma
Vedanta chairman says at AGM - Company plans to invest Rs550bn to increase output across units - Positive for Vedanta
CCL Products Q1net profit Rs347mn (down12.1% YoY), EBITDA margin 25.4% vs 21.5% and sales Rs Rs2.73bn (down 7.2%)
L&T wins orders worth Rs10-25bn - Strong Balance sheet and order book - we are positive on L&T
Trade talks with India and US today - India and U.S. trade negotiators will meet on Friday, with few signs of a compromise on a series of protectionist measures taken by the two governments in recent months that have strained ties between the strategic partners.U.S. President Donald Trump has been putting pressure on India to do more to open its markets, saying this week again on Twitter its high tariffs were unacceptable. - Expect positive outcome of trade talks between US - India. Positive for metal stocks
Watch on Adani group stocks - Gautam Adani to sell data storage services to Amazon, Google. Selling data storage services to companies such as Amazon.com Inc. and Alphabet Inc.’s Google - Expect positive on Adani group stock - Adani Enterprises, Adani Ports (Not our coverage)
Watch on PSU Bank - The heads of Public Sector Banks are likely to meet the Reserve Bank of India (RBI) Governor (RBI) next week to discuss on the future roadmap for the banks including a roadmap for bank recapitalisation - We are positive on SBI, BoB, Indian Bank
Shriram Transport Finance - Fitch Ratings has assigned India based Shriram Transport Finance Company (STFC, BB+/Stable) proposed US dollar-denominated senior securednotes an expected rating of 'BB+(EXP)' - Positive for Shriram Transport Finance - Positive for Shriram Transport
Watch on ADAG stocks - Anil Ambani plans to raise about Rs217bn ($3.2 billion) by selling assets from roads to radio stations in a bid to cut debt. Reliance Infra aims to be zero debt in 2020 - Positive for ADAG group stocks after announced to reduce debt - However, poor balance sheet is a concern - Avoid ADAG stocks.
Dividends – Cera Sanitaryware, DCM Shriram, Jyothy Labs, Kotak Mahindra Bank and Lakshmi Vilas Bank Board Meetings – Hathway Cable, IndusInd Bank, Infosys, Karnataka Bank and Quess Corp. AGM – HDFC Bank, ITC and PNB. Results - Hathway Cable, IndusInd Bank, Infosys, Karnataka Bank
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🇮🇳 *India Daybook*
🔹 *Stocks to watch for*
HFCL has received a Purchase Order worth Rs.198.82 crores from Bharat Electronics (Positive)
TCS Launches JilerM 3.0 to Help Companies Achieve Agile Transformation (Positive)
India Woods commenced Commercial Production at J&K. (Positive)
Trigyn awarded a New York State OGS Hourly Based IT Services Contract. (Positive)
Salzer Electronics: Company completed acquisition of Kaycee Industries (Positive)
Dewan Housing: Reports of auditors resignation is 'baseless'. (Positive)
Kalyani Grp Chmn Baba Kalyani says it's been long since co got a big defence order from the govt (Positive)
CERC eases norm to issue power trading license to NTPC (Positive)
Tata Steel plans to make European operations sustainable on its own (Positive)
GIC and ADIA put another $329 million in Hyderabad based Greenko. (Positive)
Adani eyes data storage with Rs 70,000-crore parks (Positive)
DEN Networks Q1: Net profit at Rs 11.2 crore versus loss of Rs 30.7 crore; revenue falls to Rs 313 crore versus Rs 314 crore YoY (Neutral)
Manpasand Beverages: Company to avail Rs 100 crore loan for working capital. Promoter Dhirendra Singh pledged entire stake. (Neutral)
Eveready Industries: Yes Bank acquired 39,10,000 equity shares of company (Negative)
KPR Mill informs SEBI that the company is unable to go ahead with its share buyback issue citing the Union Budget's proposal to tax such transactions at 20%. (Negative)
Cox and Kings Care downgraded the rating on debt instruments to care D. (Negative)
Sebi to probe if IndiGo CEO downplayed promoters' tiff: TV Report (Negative)
Kotak Instl Eq maintains buy call on Petronet LNG, raise target price Rs 310/Sh (Positive)
Nomura reiterates buy call on Petronet LNG, raise target price Rs 300/Sh (Positive)
BofAML: Cement Volumes were flat to down 3% YoY largely due to muted construction activity. Upgrade ACC and Ambuja (Positive)
Nomura on Insurance: Prefer SBI Life followed by Max Life and ICICI Pru life (Positive)
ICICI Bank gets a buy call from Kotak Instl Eq, raise target price Rs 510/Sh (Positive)
CLSA maintains buy rating on HDFC; says co is capitalising on affordable housing opportunity, raise target price Rs 2730/Sh (Positive)
Nomura maintains buy call on Glenmark; expects co to tie-up with more companies In Due Course. Target price Rs 867/Sh (Positive)
Credit Suisse on M&M: Maintain outperform, target price Rs 850/Sh (Positive)
Goldman Sachs on Avenue: Maintain Buy rating, target price Rs 1740/Sh (Positive)
UBS on Lupin: FY19 cashflow boosted by decreased working capital, target price Rs 900/Sh (Positive)
CLSA maintains buy call on NTPC; says the co is getting closer to lower under-recovery & has a robust RE growth, target price Rs 157/Sh (Neutral)
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>T.R
News and Impact
Expect market to open on a flat note on account of global cues. U.S. Dow Jones surged nearly 1% to close record high of above 27k on hope of US Fed to cut interest rate in the next policy meeting on 31st July. US Future is up 87 points or 0.3%.
Asian markets open on a caution note ahead of China economy data (export, import data) will be announced today. Moreover, Singapore GDP data declined -3.4% have a negative impact in the Asian markets. As a results, Nikkei, Hong Kong and China Index are flat to negative. SGX Nifty declined 9 points. European market declined after the IMF concern about trade tension, Brexit and slowdown Italy economy.
Brent Crude spiked to above $67/bbl of 2-month high and FIIs continued net sellers (Yesterday FIIs net sellers Rs3.17bn) which is a major concern in the market. On the other hand, fall in USDINR and 10-year G-Sec Yield 2-year low will be positive for the market. However, traders avoid aggressive buying, buy on dips strategy with strong fundamental stocks (Maruti, UltraTech, ICICI, HDFC Bank).
Yesterday, Nifty gained 0.7% rebounded from their lowest close in nearly two months, tracking regional peers after comments by Federal Reserve Chairman Jerome Powell signaled a willingness to lower interest rates.
Earnings guidance will be closely monitored by investors as economic growth slows. Infosys and IndusInd Bank are the next major Indian companies to report, with their results scheduled today. Inflation and factory data reports also to be announced today which may influence sentiment.
Sector to be watch – Auto, Metal and Tech
Actionable - Maruti, Aurobindo Pharma and Jindal Steel
Momentum Buy – Motherson Sumi, IndiaBull Housing, DHFL.
Brokers Radar – CLSA BUY HDFC TGT 2730, CLSA BUY NTPC TGT 157, Credit Swiss BUY M&M TGT 850, UBS BUY Lupin TGT 900, Nomura BUY Glenmark Pharma TGT 867, Bank of America rasied ACC TGT 1896, Goldman BUY on D-Mart TGT 1740.
Major events today – Infosys and IndusInd Bank will be announced Q1 results today. US delegation will meet today with the government for trade related issue. Industrial Production and Inflation data also will be announced today.
Infosys expectation – Infosys Q1 Dollar term revenue expectation $3122mn (up 2% QoQ), EBITDA margin expectation 23.5% and net profit expectation Rs36.57bn (down 10.3% QoQ).
indusInd Bank – Watch on NPA details and any recovery from IL&FS, As of now Rs30bn exposure on IL&FS.
KPR Mill first company to withdraw share buyback after Budget imposed 20% tax. Expect others companies will be withdraw share buy back – Negative for the market.
Watch on Emami – Company released 17 lakh pledge share – Positive for Emami.
Watch on Ashok Leyland and Tata Motors – Both the companies shut its plant by 10-12 days on account of slowdown demand – as per media report – Negative for Ashok Leyland and Tata Motors
Media news that the government has sought information from the SEBI about the origin of those foreign portfolio investors (FPIs) that use the trust structure and asset they manage. Govt. also want details tax liability, custodians provide all data barring tax information – It may negative impact of foreign flow
DHFL Still in Talks With Aion, Cerberus, Oaktree for Deal: Dewan Housing Finance Corp.’s lenders have assured non-convertible debenture holders of a “comprehensive resolution plan” that would maximize value for all stakeholders - Avoid Dewan Housing.
DHFL resolution plan - Cash-strapped DHFL will be submitting a resolution plan (RP) to its lenders early next week. The RP will be discussed by lenders and the same would thereafter be adopted with modifications/ changes as they deem fit, said sources clued in to the developments. At a meeting on Thursday attended by lenders and non-convertible debenture (NCD) holders, bankers are understood to have agreed to go ahead with the modalities of signing the inter-creditor agreement (ICA). They also want to take the NCD holders into confidence when framing the RP. This is aimed at ensuring that all stakeholders realise their dues to the maximum extent possible – Positive on DHFL.
Rating agency - Fitch affirms Glenmark Pharma at BB, outlook stable - Positive for Glenmark
NTPC plans to sell up to Rs45bn of 10-year Bonds - Positive for NTPC, strong balance sheet and attractive dividend yield.
Housing affordability worsened in India in the last four years. Indians now spend a bigger proportion of what they earn on buying a home than in 2015, according to the RBI’s residential asset price monitoring survey of 13 cities. The house price to monthly income ratio has risen from 56.1 in March 2015 to 61.5 in March 2019. The ratio has remained above 60 since December 2015 – Positive for housing finance stocks like PNB Housing, India Bull Housing, Can Finance Home.
Government increases Coal extraction price for steel, cement firms - Companies including Hindalco Industries, JSW Steel, Tata Sponge Iron and UltraTech Cement will need to pay 3.62% more for every ton of coal extracted from mines they won in auctions - It may not major impact on Cement and Steel sectors. Coal India likely to be positive.
Tata Investment names Abhijit Sen and Jimmy Tata additional Director - Positive development on Tata Investment (Not our coverage)
Gravita India starts output of Aluminum cast alloys at Tanzania - Positive for Gravita India
United Breweries names Berend Odink as CFO - positive for United Breweries
Tata Motor JLR June Global wholesales at 95503 unit, declined 5% YoY - Tata JLR sales volumes increased gradually. Moreover, will be positive for Tata JLR if the US Fed cut interest rate
Glenmark Pharma, Torrent sign pact for Remogiflozin Etabonate - Under the terms of this non-exclusive agreement, Glenmark will manufacture and supply Remogliflozin Etabonate while Torrent will market the drug under its own trademark in India - Positive for Glenmark and Torrent Pharma
Can Fin Homes to consider sale of Rs60bn of debentures July 22 - Positive for Can Finance House
Sun Pharma : U.S. FDA approves Sun Pharma’s Risedronate Sodium ANDA - Positive for Sun Pharma
Vedanta chairman says at AGM - Company plans to invest Rs550bn to increase output across units - Positive for Vedanta
CCL Products Q1net profit Rs347mn (down12.1% YoY), EBITDA margin 25.4% vs 21.5% and sales Rs Rs2.73bn (down 7.2%)
L&T wins orders worth Rs10-25bn - Strong Balance sheet and order book - we are positive on L&T
Trade talks with India and US today - India and U.S. trade negotiators will meet on Friday, with few signs of a compromise on a series of protectionist measures taken by the two governments in recent months that have strained ties between the strategic partners.U.S. President Donald Trump has been putting pressure on India to do more to open its markets, saying this week again on Twitter its high tariffs were unacceptable. - Expect positive outcome of trade talks between US - India. Positive for metal stocks
Watch on Adani group stocks - Gautam Adani to sell data storage services to Amazon, Google. Selling data storage services to companies such as Amazon.com Inc. and Alphabet Inc.’s Google - Expect positive on Adani group stock - Adani Enterprises, Adani Ports (Not our coverage)
Watch on PSU Bank - The heads of Public Sector Banks are likely to meet the Reserve Bank of India (RBI) Governor (RBI) next week to discuss on the future roadmap for the banks including a roadmap for bank recapitalisation - We are positive on SBI, BoB, Indian Bank
Shriram Transport Finance - Fitch Ratings has assigned India based Shriram Transport Finance Company (STFC, BB+/Stable) proposed US dollar-denominated senior securednotes an expected rating of 'BB+(EXP)' - Positive for Shriram Transport Finance - Positive for Shriram Transport
Watch on ADAG stocks - Anil Ambani plans to raise about Rs217bn ($3.2 billion) by selling assets from roads to radio stations in a bid to cut debt. Reliance Infra aims to be zero debt in 2020 - Positive for ADAG group stocks after announced to reduce debt - However, poor balance sheet is a concern - Avoid ADAG stocks.
Dividends – Cera Sanitaryware, DCM Shriram, Jyothy Labs, Kotak Mahindra Bank and Lakshmi Vilas Bank Board Meetings – Hathway Cable, IndusInd Bank, Infosys, Karnataka Bank and Quess Corp. AGM – HDFC Bank, ITC and PNB. Results - Hathway Cable, IndusInd Bank, Infosys, Karnataka Bank
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Economic Times
 
Business Standard
Ø  India e-commerce rules regressive: Walmart to US govt
Ø  'China is letting us down on buying from US farmers'
Ø  Temasek keen to increase pace of investment in India
Ø  Govt committed to disinvestment of Air India: Puri
Ø  Care downgrades Cox and Kings rating to ‘default’ grade
Ø  Auto industry to conduct study on EV migration
 
Ø  Tata Steel plans to make European operations sustainable on its own
Ø  MCA may expand powers of regional directors for M&As of higher categories
Ø  India-US trade talks to restart Friday; compromise on tariffs likely
Ø  Sebi to probe if IndiGo CEO downplayed promoters' tiff: TV Report
Ø  ED attaches fugitive jeweller Mehul Choksi's assets in India, abroad
Business Line
 
Mint
Ø  Govt restarts process of divesting Pawan Hans
Ø  Reliance Power recasts Rs 2,430 crore loan for Samalkot project
Ø  Delay in IBC resolution a concern: JSW Steel chief
Ø  DHFL to submit resolution plan to lenders next week
Ø  Kalyani Rafael secures $100-mn order for Barak-8 missile kits
Ø  Anil Ambani plans $3.2 billion asset sales
 
Ø  PE/VC investments cross $23 billion in 2019 first half, 27% higher: report
Ø  SBI puts up for sale two NPA accounts to recover dues of ₹309 crore
Ø  Railway officials meet stakeholders to finalise private ops of two trains
Ø  GIC and ADIA put another $329 million in Hyderabad based Greenko
Ø  IL&FS arm puts its shares in 2 wind energy assets for sale
Financial Express
 
Deccan Chronicle
Ø  Moglix raises $60 million from Tiger Global, others
Ø  US India bilateral trade could reach USD 238 billion by 2025
Ø  India attracts $64.4 billion FDI in FY19 despite global headwinds, says Union minister
Ø  CERC eases norm to issue power trading licence to NTPC
 
Ø  Rupee advances 14 paise to 68.44 against USD on Fed rate cut signals
Ø  Housing affordability worsened in four years, shows RBI survey
Ø  Adani eyes data storage with Rs 70,000-crore parks
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Good Night!
LTP: Gld 34711/ $1407.35, Sil 38108/ $15.13, Cr 4126/ $60.24, Co 441.4/ $2.685, Z 192.2, L 156.4, N 914.5, AL 142.1, NG 165,Eur 1.1253, INRFut 68.545, Dw 154, Nd -15
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*SMC Global Institutional Equities*
*Q1FY20 Earnings Preview*
• Corporate earnings likely to remain subdued during the quarter as well
• Markets expectations of earnings recovery is unlikely to come true during the quarter as well. The slowing GDP number itself indicates that probably all is not well in the economy. In the previous quarter there was already some visible slow down in the consumption pattern which seems to have got further impacted during the quarter. And when consumption gets impacted even other industries also can remain insulated for sure. Accordingly we feel the overall earnings of the corporate are likely to have moderated during the quarter and the earnings recovery gets delayed further.
• Indian currency has been stable for large part of the quarter and hence forex related gains and losses are unlikely for corporate. IT & Pharma Companies generally get positive benefit when the Indian currency is weak vis a vis others as majority of them are export oriented in nature. IT companies have received some decent deals during the quarter, however the margin improvement is unlikely for the corporate during the quarter.
• System wide credit growth has slowed down a bit to 12% vs ~13-14% like previous quarters. In Q4FY19 the NBFC led liquidity crisis did hit consumption to some extent and NBFC witnessed slow down in the business growth. During the current quarter also it seems the slowdown in NBFC would continue as getting low cost funds has not been easy task for them.
• While there has been enough liquidity when looking at the system the liquidity crunch with NBFC is severe and accordingly RBI has further tried to infuse liquidity to help the well managed NBFCs but helping Banks to purchase their pooled assets.
• Mid cap companies under our coverage having business interest in Chemicals would have a challenging quarter. While structurally there is no major negative for the sector the large user industries of the Chemicals are going through some slowdown and hence there will be some volume and pricing growth issues during the quarter. Stocks like companies like NOCIL , Apcotex and Bodal will have a soft quarter due to lack of volumes.
• Our channel checks on ground shows that there has been good amount of pick up on the completion of Infrastructure projects and hence pipe companies like APL Apollo and Hitech Pipes could see impressive results during the quarter. The provisional volume figures released by these companies have been encouraging.
*Link to Report:*
*Research Analyst*
Siddharth Purohit
*Research Analyst*
Ankit Merchant
*Research Associate*
Udit Gajiwala
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CPI m/m: Previous 0.1% Expected 0.0% Actual 0.1%
Core CPI m/m: Previous 0.1% Expected 0.2% Actual 0.3%
Unemployment Claims: Previous 221K Expected 220K Actual 209K
Impact: Overall data is supportive for USD and negative for Bullion.
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Economic Data Releases
6:00pm USD CPI m/m Poll 0.0% Prior 0.1%
6:00pm USD Core CPI m/m Poll 0.2% Prior 0.1%
6:00pm USD Unemployment Claims Poll 220K Prior 221K
8:00pm USD Natural Gas Storage Poll 71B Prior 89B
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Economic Times
Business Standard
Ø RBI panel proposes extension of forex market timing
Ø Trade setup: Nifty evenly poised, must reclaim 100-DMA at 11,506
Ø IL&FS puts 2,880-acre land parcels in Kutch for sale
Ø HDFC to raise up to Rs 3,000 crore via bonds
Ø Metal shares under pressure; JSW Steel, Hindustan Zinc hit 52-week lows
Ø Reliance Capital, Reliance Infra dip for sixth straight day, fall up to 7%
Ø SpiceJet rallies 9% on heavy volumes as IndiGo, Jet Airways slip in trade
Business Line
Mint
Ø Oil prices rise as data shows bigger-than-expected fall in US stockpiles
Ø JLR June sales drop 9.6% at 47,060 units
Ø Singareni Collieries starts work at Naini coal block in Odisha
Ø Cotton’s crash amid likely glut set to deepen
Ø Axis Bank appoints Citi, JPMorgan, Axis Capital for $1.3-billion share sale
Ø S&P 500 hits 3,000 for first time as Fed signals possible rate cut
Ø $42 billion wiped off Indian stocks as doubts on tax linger
Financial Express
Deccan Chronicle
Ø Jio retains lead over Airtel, Vodafone Idea in AGR for March quarter: Trai
Ø OYO is now world’s third largest hotel chain; might go for IPO after three years
Ø India Inc's FDI down over two times to $820 million in June
Ø Auto stocks fall up to 3 pc after SIAM's sales data
Ø Rupee trips 7 paise to 68.58 vs USD
Ø FPIs can opt for corporate route to avail lower tax surcharge: CBDT chief
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